XRP Lawsuit: SEC Ordered To Pay For Improper Conduct• April 21, 2022 1:46 pm • Comments
Ripple had lost its motion to strike the Metz Report which was the action that Ripple took when accusing the SEC of “gamesmanship” by constantly employing delay tactics throughout the case.
By striking that motion, it opens discovery all the way to the May 13 date which extends the expected timeline once again.
Although this failed to prevent the SEC from delaying the case, there was a few positive things that came out of it as a result.
The main positive note was that the SEC has now been ordered by the court to pay the defendant “reasonable expenses” in filing the motion.
In other words, the SEC has been punished by the court financially to cover all the costs that Ripple had incurred which includes covering the costs of Dr. Metz’s time.
#Ripple lawsuit: SEC ordered to pay for improper conduct amid report on XRP – FinanceFeeds https://t.co/n1clkMwhxu
— DJ Peter Vas (@PeterVas6) April 20, 2022
The court stated “the SEC has conducted itself improperly by serving an unauthorized supplemental report on the last day of discovery”.
For that, “the SEC is ordered to pay Defendants’ reasonable expenses in filing their motion to strike and re-deposing Dr. Metz.
The parties’ prior agreement that each side shall cover the costs of their own expert’s time shall control; accordingly, the SEC shall also cover the costs of Dr. Metz’s time.”
In other news, the court denied the motion to compel the SEC to produce the Estabrook notes because Judge Sarah Netburn found it to be protected by privilege.
Since Brad Garlinghouse was in that meeting, his testimony will be “very very powerful […] no questions asked”, according to attorney Jeremy Hogan.
To give a background summary on the purpose of the Metz reports, the reports are supposed to show how the actions of Ripple actually impact the price of XRP using statistical analysis.
Dr. Metz had also studied the relationship in price between XRP and other assets like Bitcoin and Ether to attempt to see if XRP followed the price of those other tokens.
The report mentions that the price of BTC and ETH correlated with only 40% of XRP’s price movements.
However, it seemed that the report was flawed due to it failing at basic math which greatly discredits the SEC’s position.
“The @SECGov is ordered to pay Defendants’ (@Ripple) reasonable expenses in filing their motion to strike and re-deposing Dr. Metz,” Judge Netburn ruled. #XRP #XRPCommunity #XRPArmy https://t.co/rtJSgiIRGt via @The Crypto Basic
— Eric Martinson (@ericmartinson) April 21, 2022
FinanceFeeds shares the details:
The infamous Metz report is a statistical analysis of the economic significance of Ripple’s news announcements, but the document has been criticized for failing at basic math.
Twitter user @TheXRPArsenal pointed out that “97 out of 500 ‘news’ price rises accounts for around 20% of the data. It was observed that 40% of BTC/ETH moves resulted in $XRP moves.
Last time I checked, 40% is more than 20%.
“In addition, 40% of the 7 years that were analyzed equates to 1022 days. 10x the amount of days that Dr. Metz states that $XRP was subject to positive movement due to ‘Ripple news’.
These stats just serve to prove $XRP is more bound to the wider market than Ripple.”
James Filan comments that it was a poorly written response that wrongly accuses Ripple failing to follow proper procedure when the fault was actually with the SEC.
The SEC being ordered to pay for this improper conduct should be expected.
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